China's labour timebomb

China is facing the prospect of an increasingly ageing and obese population that could adversely affect the country's economy, according to new reports.

23 Aug 2006 03:07 GMT

Factories in some areas are experiencing labour shortages

A newspaper report on Monday blamed the Communist government's one-child policy for labour shortages that could undermine the so far endless supply of cheap workers that has underpinned China's extraordinary economic boom.

A report, produced by the Chinese Academy of Social Sciences, a top government think tank, said industry had yet to face up to the fact that incomes have not risen fast enough to support pensioners.

"In the not too distant future there will be a day when there is an end to the unlimited labour supply," the state newspaper which quoted the report, the China Youth Daily said. "It is this that had been one of the most basic advantages of China's recent economic development."

Family planning policies started in the late 1970s have prevented the birth of hundreds of millions and signs of possible problems in the future can be seen in economic heartlands in Guangdong and near Shanghai where factories are already finding it hard to get workers.

As time goes by

"Although China wants to change the proportion of manufacturing industry (in the economy), it will take a long time, and today there are no signs or motion towards this adjustment happening," the report said. "The labour force is doubtless the most basic support of economic development."

According to a United Nations study released last year, the number of people aged 60 or over is expected to rise to 31 percent of the population in 2050, or more than 430 million people, from just 10.9 percent last year.

That would be well above the projected world average of 21.7 percent in 2050.

"In the not too distant future there will be a day when there is an end to the unlimited labour supply"

China Youth Daily

The report said the appearance of an ageing population in a developing country where per capita GDP has only just exceeded $1,000 was "unprecedented".

"The country is unique in the world in that is it aging first without becoming affluent," it said.

Analysts have warned that China faces a "pension time bomb" from its ageing population.

Expanding waistline

That older population is also likely to see the explosion of an obesity time bomb, according to another report on Monday.

About 25 percent of boys between the ages of seven and 18 in urban China are overweight, up from just 0.2 percent in 1985, the China Daily said, citing a survey of 400,000 students across the country.

"China was once considered to have one of the thinnest populations but it is fast catching up with the West in terms of the prevalence of children who are overweight," said Yang Guiren, a senior official in the education ministry.